Activate Fees on Asset Management Yield and Premiums Paid

Context:

Unslashed is regularly generating between 7% and 11% APY in pure ETH for Capital Suppliers (ETH depositors) in the spartan bucket. On top of that yield, the ongoing Capital Mining program allows underwriters (capital suppliers) to get an additional 3% to 6% APY distributed in USF tokens. There were multiple discussions regarding having a fee applied to the yield that is generated for capital suppliers.

The objective of the proposal is to start having a share of the generated yield redirected to the DAO treasury while also aligning interests between the DAO and Capital Suppliers by having a progressive fee structure.

Proposal:

Start rolling out the fees in a step by step fashion for the Spartan Bucket:

  • For 8% AM + Premiums yield, Unslashed DAO Treasury takes a 5% fee (0.4% of the current AUM, current eq. $400k per year)
  • For 9% yield, Unslashed DAO Treasury takes a 10% fee (0.9% of the current AUM, current eq. $900k per year)
  • For 10% yield, Unslashed DAO Treasury takes a 12% fee (1.2% of the current AUM, current eq. $1.2m per year)
  • For 11% yield, Unslashed DAO Treasury takes a 14% fee (1.5% of the current AUM, current eq. $1.5m per year)
  • For 12% yield, Unslashed DAO Treasury takes a 16% fee (1.92% of the current AUM, current eq. $1.9m per year)
  • For 13% yield, Unslashed DAO Treasury takes a 18% fee (2.34% of the current AUM, current eq. $2.3m per year)
  • For 14% yield and above, Unslashed DAO Treasury takes takes a 20% fee (2.8% of the current AUM, current eq. $2.8m per year)

These levels could be changed to follow market conditions.

Key advantages:

  • It shows “protocol revenue” and eventually would help get us listed here https://www.tokenterminal.com/ and helps us get more visibility.
  • It aligns interests, if the protocol wants to generate more revenue then it needs to get more yield for the underwriters/capital suppliers.

The accumulated treasury could be used to buy-back USF and remove it from the market at levels/ranges that make sense for the DAO and are perceived as “cheap” or “undervalued”.

Excited to hear your thoughts on this one!

1 Like

This has been a long discussed topic of interest for many. I’m glad to see it finally arriving. Lots of good things happening within the USF universe and its looking good!